Every company should have as a goal that improvement is not an option, but rather a must-change-to-stay-competitive-or-we’ll-fail mentality. Most companies who embrace lean manufacturing practices simply refer to this as being in “continuous improvement."

Improvement requires effort, even though everyone is already tasked with a very busy workload. Few want to give up their current practices, believing only the other departments need to make any type of change. Newbies to the continuous improvement process often do their best to show how much the overall organization will benefit from the changes, but without true buy-in from everyone, along with the backing of better management practices, it is a total waste of time. These companies are typically rife with micromanagement, and employees are conditioned never to take ownership or to offer suggestions for improvement. More often than not, these types of companies view a major equipment purchase as the one thing that will make all the difference.

Typically, an equipment purchase is heavily influenced by the recommendation of a technology vendor, without the client company knowing the true pros and cons of the solution. Too often, once the new equipment is purchased and installed, all of the other practices that need to be refined for its proper use are not thoroughly considered and, therefore, the new investment is only marginally helpful. I cannot tell you how many times I have witnessed expensive equipment being severely underutilized. Without a doubt, these types of situations are the most difficult and disheartening to witness, because the affected organizations typically have high employee turnover with positions constantly vacant, so their overall output suffers. Their cost of manufacturing is often higher than necessary. Also, their net profits are often in the single digits. These are the companies that will have trouble remaining in business during tough times.

Real positive change comes from the top of the organization. But the CEO must resist the temptation to override people’s ideas and suggestions. To facilitate better practices, the CEO must give employees tools with real-world examples of how these tools work within the company. Employees cannot implement anything new if they are not exposed to other ways of doing business and appropriately trained on the initiative. Once employees understand that their ideas have true value within the company and are exposed to better practices, you will see real gains.

The best companies implement better practices by teaching new ideas about lean manufacturing principles, listening instead of demanding, empowering and encouraging employees to take ownership of their new ideas, and consistently promoting a teamwork attitude. Many ask me, “What is the single most important thing that will make a real positive difference in our organization?” I tell them that they must first embrace the idea of a culture of continuous improvement, and everything else comes second. Yes, refining labor standards, improving pricing methods, and maybe purchasing new equipment will make a big difference, but all the other things need to be done, too. It is never just one thing but rather many things that add up to making a real positive change. A sustained effort is needed to constantly review and methodically implement all the desired changes you are going to implement. Every company I have seen nurture this type of cultural environment has three common results:

  • lowest employee turnover, both in the shop and in the office;
  • lowest cost of manufacturing, lowest errors, and best quality; and finally,
  • best net profits that start in the mid-teens and are often in the mid-20s during peak times.

Change for most of us is uncomfortable and can be downright stressful. And, sometimes, it’s difficult to get everyone on board. However, no person should hold back an entire department or company. If he can’t move forward with the group, then it might be time to let him go. It might be difficult to part ways, but the short-term pain will soon pass when everyone else has finally had the chance to flourish and grow.